WTI (Mar) $74.37 -38c, Brent (Mar) $79.55 -51c, Diff -$5.18 -13c. 

USNG (Feb) $2.45 +3c, UKNG (Feb) 67.4p +5.15p, TTF (Feb) €27.905 +€0.678.

Oil price

Same old, same old tugs either way on the oil price and although the trading range remains narrow, a set of robust inventory data has meant that crude is up a bit today. Overnight President Trump won the New Hampshire Primary which makes his nomination a certainty.

Diversified Energy Company

Diversified is providing an update regarding the recent movement in the Company’s share price. The Company and Board of Directors are aware of the recent opportunistic report published by a short seller which repeats previously stated claims that the Company has already transparently and proactively addressed with investors and other stakeholders. This report contains numerous inaccuracies, ignores specific financial and operational results and sustainability actions, and is designed for the sole purpose of negatively impacting the Company’s share price for the short seller’s own benefit.  

The Company continues to focus on delivering long-term shareholder value, prioritization of outstanding debt reduction, and evaluating strategic growth and accretive value-additive opportunities. As previously announced, the Company plans to provide its year-end trading statement by January 31st.

Diversified is an important part of the solution amid the energy transition to consolidate, and retire existing U.S. energy infrastructure assets, drive economic growth and deliver emission reductions, and remains committed to the responsible ownership and operation of our assets.

I was in the process of writing on DEC already and was analysing the letters to and from the U.S. House of Representatives Committee on Energy and Commerce which had been started following letters received from four members of that committee who had requested information.

Assessing those letters and more importantly how and why the company decided to reply is of significant interest. Even though by nature of the letters coming from a few individual members, who are also not in the majority on the Committee, DEC didn’t have to respond at all, the fact is that they did and to a great extent put to bed the Asset Retirement Obligations that were put to them. 

I have to say that this virtually unknown organisation who have taken this shot at DEC and a shot that is at a very easy target given the current malaise of the energy sector and one where the yield has got to a level at which even the company would be considering the best way forward in terms of internal funding and shareholder rewards. 

The reason for this in most cases in the sector has been a degree of forced selling by income funds who have seen a great number of redemptions and consequently the high yield is sometimes largely affected by the long-only income funds who are restricted to balancing the books.

On a day to day basis DEC is going about sorting out the ARO’s, continuing to look at both acquisitions and disposals as part of normal portfolio and in fact current restraints are more than likely to enable the company to find new ways of funding these M&A activities which have always added value to the assets.

Whilst it may be on the back foot from this attack I think that the overall strength of the portfolio and valued at well above the current market cap will ultimately mean that the exceptional management of DEC of a portfolio that with healthy oil and gas prices will mean that the short-term nature of rifle shot short trading is unprofitable and more importantly short lived.

The bottom line is that the management, who are major shareholders will always act in the best interests of the owners of the business and act accordingly. Finally for a company that is well hedged it correlates with the US natural gas price closely and that has fallen recently and I happen to expect a significant rise. 

Genel Energy

Genel has issued the following trading and operations update in advance of the Company’s full-year 2023 results, which are scheduled for release on 26 March 2024. The information contained herein has not been audited and may be subject to further review.

Paul Weir, Chief Executive of Genel, said:

“Since the suspension of exports through the Iraq-Türkiye pipeline in March last year, we have reshaped the business to provide long-term resilience and maximise potential upside exposure for shareholders.

We have cut all non-essential activity and significantly reduced spend, while developing a new source of income through domestic sales. We have well over a hundred million dollars in net cash, and expect to be in a position where domestic proceeds, if sustained at levels seen in the fourth quarter of 2023, would mean that our income covers our ongoing costs from March onwards, once Sarta and the arbitration hearing workstreams are complete. We also continue to work hard to add new assets to increase and diversify our income streams.

The past six months have included significant work, and effective spend, on efficiently closing out our activity on Sarta and minimising our footprint and cost base in Kurdistan. Our workforce has been reduced by over two thirds in the year. We have progressed civils work in Somaliland, and we continue to defend shareholder value as we progress our arbitration claim regarding the Miran and Bina Bawi oil and gas assets.

There is real potential in 2024 for significant improvement in cash generation and delivery of shareholder value from multiple catalysts – the resumption of exports and regular payments, clarity on the timing of the recovery of $107 million of receivables, delivery on our strategy to add new assets to diversify our production portfolio, and a successful arbitration result and subsequent collection.”

Whilst nothing changes at Genel and the pipeline remains shut, the company is exuding a confident tone. After cutting its cloth it actually looks in a remarkably strong position. 

Enforced expenditure cutbacks and a strict diet of only local sales from Tawke has left Genel with a strong enough cash position to covers costs by the end of this quarter and in the event of a restart, as shown in their presentation, a highly profitable future.

Genel have been looking hard in the market for M&A opportunities but with nothing to report yet are still looking, alone and with other partners. Nothing to report of arbitration as expected and also there is no well in Somaliland in the immediate plans. 

Going forward guessing the restart date is indeed futile, it will happen when it does, political meetings come and go, one day the politicians will surprise us all. In the meantime Genel is outperforming the pack, has a good cash position and the scope to move if they see anything that they like in the acquisition market, better than most I would say…


  • Zero lost time incidents in 2023, matching the performance of 2022, with over four million hours worked since the last lost time incident
  • Net production of 12,410 bopd in 2023 (30,150 bopd in 2022), following the closure of the Iraq-Türkiye pipeline (‘ITP’) in March, with minimal sales between April and August inclusive and the subsequent development of domestic sales
  • Total proceeds of $101 million (2022: $473 million):
    • $61 million export sales proceeds relating to sales made in August and September 2022
    • $40 million domestic sales proceeds in H2 2023, of which $26 million was received in Q4 2023 as volumes improved from Q3 2023
  • $107 million remains overdue from the Kurdistan Regional Government (‘KRG’) for oil sales from October 2022 to March 2023 inclusive
  • Capital expenditure of $71 million, of which $24 million was in H2, as Genel cut activity and costs in an appropriate manner for the external environment
  • Free cash outflow of $72 million (2022: positive free cash flow of $235 million)
  • Bond debt reduced by $26 million nominal at an average price below 95¢
  • Dividends totalling 12¢ per share paid in 2023 (2022: 18¢ per share), a total distribution of $33.5 million. Due to the lack of visibility on the timing of pipeline exports resuming and the re-establishment of a reliable record of payments, Genel has suspended its dividend programme
  • Cash of $363 million at 31 December 2023 ($495 million at 31 December 2022)
  • Net cash under IFRS of $119 million at 31 December 2023 ($228 million at 31 December 2022)
    • Total debt of $248 million at 31 December 2023 ($274 million at 31 December 2022)



  • Should local sales continue at similar levels to Q4 2023, the Tawke PSC would generate sufficient funding to cover organisational spend from Q2 onwards
  • Organisational spend outside the cash generative Tawke PSC is set to be reduced to around $3 million per month by the end of Q1, following completion of final remediation work at Sarta and the Miran and Bina Bawi arbitration hearing
  • Interest expense is fixed at $2 million per month, paid half-yearly, with interest income from our cash currently around $1.5 million per month
  • This outlook is expected to maintain net cash above $100 million throughout 2024, and preserves the financial capability to add new assets


  • The Iraq-Türkiye pipeline (‘ITP’) shut on 25 March 2023
  • While there continue to be positive meetings between relevant parties regarding reopening, there remains a lack of clarity regarding the status and timing of export resumption
  • The Association of the Petroleum Industry of Kurdistan (‘APIKUR’), of which Genel is a member, remains committed to working with the Federal Government of Iraq and the KRG to resume full production and export through the ITP for the benefit of all stakeholders


  • The London-seated international arbitration including Genel’s claim for substantial compensation from the KRG following the termination of the Miran and Bina Bawi PSCs is progressing. The two-week hearing is scheduled to start in London on 19 February 2024
  • The KRG’s claim is that the KRG was entitled to terminate the Bina Bawi and Miran PSCs. Genel’s claim is that the KRG’s termination of the PSCs was repudiatory and, as a consequence, is claiming substantial damages. The KRG is not claiming any damages from Genel
  • In total, Genel spent in excess of $1.4 billion acquiring and attempting to develop the Bina Bawi and Miran fields
  • The hearing is confidential and as such we will not be able to update on progress until the Award is received, with the timing of the Award uncertain, but expected in 2024


(bopd)Gross production


Net production


Net production


Taq Taq1,3606001,980


  • Tawke PSC (25% working interest)
    • Gross production from the Tawke licence increased to 65,780 bopd in Q4 2023, up from 25,980 bopd in Q3, with the field partners selling their entitlement share into the local market
    • In Q4, Genel received proceeds of $26 million and generated cash flow of $13 million from the Tawke PSC
  • Sarta (30% working interest and operator).
    • The Sarta PSC terminated on 1 December 2023. Remediation activity is now complete, at a net cost of $1 million
  • Taq Taq PSC (44% working interest and joint operator)
    • There has been no production since 20 May 2023, following closure of the export pipeline

Monthly costs have been reduced to below $1 million, with further cuts expected

  • Somaliland
    • Required civil work on the Toosan-1 well site on the SL10B13 block (51% working interest and operator) at this stage of the project is now complete
    • The Company continues to assess the timing of further investment
  • Morocco
    • The farm-out programme on the Lagzira block (75% working interest and operator) is ongoing


Afentra has provided an operational and financial update for 2023.  Afentra currently holds non-operated 18% and 5.33% working interests in Blocks 3/05 and 3/05A, respectively, offshore Angola with working interests to increase to 30% and 21.33%, respectively, following completion of the impending Azule transaction.

Operational Highlights

·      2023 average gross production for Block 3/05 and 3/05A was 20,180 bopd

·      Strong operational performance and successful well interventions have positively impacted performance with gross production of over 22,000 bopd in December 2023

·      Drone survey completed as part of a holistic gas management program to identify, measure and reduce GHG emissions

·      30 successful well interventions were completed in 2023, a similar number of interventions are planned for 2024

·      Water injection performance improved throughout the year with ~42,000 bwipd1 being achieved in December, further work planned for 2024 is expected to significantly increase water injection rates

·      Production was restored at the Gazela field on Block 3/05A in March and averaged 970 bopd, gross, through 2023

·      Progressed the review of future investment options to unlock the significant resource base including installation of  ESPs, heavy workovers, infill drilling and development of Block 3/05A discoveries.

Financial Highlights

·      Cash resources at year end 2023 of $19.6 million, which includes restricted funds of $4.9 million 2

·      Debt drawdown on Reserve Based Lending Facility of $33.6 million resulting in year end net debt of $14.0 million

·      Block 3/05 license extension and fiscal terms improvements approved by government enhancing economics and supporting future investment programs

·      Company sold its first cargo in August 2023, 300,000 bbls of crude oil at sales price of $88/bbl, generating pre-tax sales of $26.4 million

·      Crude oil stock as at year end 2023 of approx. 300,000 bbls, which with subsequent production supports crude oil lifting of ~450,000 bbls planned for late February

·      Afentra has proactively hedged 70% of its February cargo, this provides floor of $70/bbl and full exposure to the crude oil price upside

·      Asset level cashflow generation related to 30% equity in 2023 was $67.4 million at an average weighted sales price of $90/bbl.

Azule Acquisition

·      The Government approval process is ongoing with the acquisition expected to complete later in Q1 2024

·      The transaction has an effective date of 31 October 2022 with accrued net revenue being reflected in final payment on completion

Paul McDade, Chief Executive Officer, Afentra plc commented: 

“2023 was a transformational year for Afentra with the completion of acquisitions from both INA and Sonangol of non-operating interests in Blocks 3/05, 3/05A and Block 23. Afentra identified these as assets with very significant upside potential and targeted acquiring a material ownership in the production licenses. In 2023 we made substantial progress towards that strategic goal and the asset partnership has been able to demonstrate the clear potential upside in the assets as the work programme designed to optimise production is accelerated. The strong operational performance and well intervention program in 2023 allowed us to increase gross production to 22,000 bopd by year end. In 2024 the operational activities and planning for future work programs will build on this early success and lay the foundations for continued production growth for many years ahead. The license extension to 2040together with the revised fiscal termswill enable the unlocking of further significant resources whilst reducing the emissions profile.

The Company has achieved these successes whilst maintaining a robust financial position, at year end we had net debt of $14 million with an oil stock of ~300,000 bbls, despite executing these transformative transactions without the need to issue new equity. Our first successful sale of crude in August 2023 will be followed by a further sale of crude, approx. 450,000 bbls, planned for late February 2024. This sale will further strengthen our financial position ahead of the completion of the Azule transaction. 

We look forward to the completion of the Azule acquisition in the coming months, and to another strong year of operational delivery in Blocks 3/05 and 3/05A as these assets underpin our more ambitious growth strategy in Angola and other target markets in Africa.”

Believe it or not Afentra is one of the best performers in the sector and with production of over 20/- b/d by the year end and the company exude confidence about this figure growing strongly, and so they should. Already completed work will see them top this and as they say, for many years ahead, a  key feature of the asset they purchased. 

With the Azule acquisition scheduled to be completed imminently, which will considerably add to the existing production and financial position, it being back loaded, which makes it a double whammy as it were and makes Afentra amongst the most attractive stocks in the bucket list. 

Operations Summary

Block 3/05 (18%)3Two successful light well intervention campaigns (‘LWI’) were carried out in 2023 involving 30 wells. This involved successfully re-entering wells to carry out matrix and tubing washes, perform water shut offs and re-perforations. These delivered incremental production leading to average monthly gross production increasing to over 22,000 bopd in December and have demonstrated the benefits of low cost well interventions. Investment in water injection upgrades have doubled injection rates since 2022 with December rates reaching 42,000 bwipd and further significant improvements expected in 2024. Thimproved water injection is expected to positively impact oil production in the medium term as reservoir pressure increases. A drone survey to identify fugitive emissions and assist in quantifying flaring was carried out in November to better understand the emissions profile of the asset. This forms part of a holistic gas management program to identify, measure and reduce GHG emissions.

A full CPR was completed as part of the re-admission of the enlarged group to trading on AIM with an effective date of 1 July 2023 and published in the Company’s admission document. Based on this report reserves replacement in the first half of 2023 has been in excess of 150%.

Block 3/05A (5.33%)3 production was restored at the Gazela field in March with the Gaz-101 well averaging 970 bopd, gross, through 2023. This extended production test will help to establish the long-term resource potential and appropriate development strategy. Development concepts for the Caco-Gazela and Punja discoveries were progressed with a focus on balancing near term production growth, phasing of investment, alongside maximising value.

2024 & future operations The license extension to 2040 and revised fiscal terms have improved the attractiveness of the planned further investment which will unlock the significant remaining resource base.  In 2024 an additional LWI campaign will be carried out with over 30 activities planned across both blocks. Water injection capacity is expected to steadily increase through 2024 with a target to double the 2023 average injection rate. A comprehensive shutdown is planned for Q3 2024, this will include power and water system upgrades, platform maintenance and re-certification of the Palanca FSO through to 2029. The installation of new gas flare meters during the shut down will enable an accurate baseline emission profile to be generated. With these plans and the 2023 drone survey and Q1 2024 methane Infra Red study of the asset, the joint venture partnership is beginning to deliver on and develop the future gas management workstream.

Planning is continuing on the selection of the initial phase for ESP installation, heavy workovers and selection of B3/05 & B3/05A infill wells. Drilling candidates include the undeveloped Bufalo Nord field, Gazela discovery and a near field exploration well at Pacassa South West. A decision on these investments will occur in 2024 enabling the purchase of Long Lead Items (LLI) for delivery of the programs in 2026. In Block 3/05A the extended production test on Gaz-101 will continue, enabling further definition of the development concept for the Caco-Gazela discovery. A sea bed survey will be acquired over the Punja discovery to enable planning for a future gas pipeline as part of a potential zero-flaring well head platform development concept.

Angolan Onshore Bid Round: Afentra submitted bids for Blocks KON15 (1,000 Sqkm) and KON19 (900 Sqkm) located in the Kwanza onshore Basin as a non-operating partner and has been informed that it has been selected as preferred bidder for a non-operated 45% equity in both blocks.

Odewayne block: offshore Somaliland (34% interest fully carried by operator, Genel Energy), the operator and Afentra completed updated petroleum systems and satellite seep studies with borehole planning in progress.

Financial Summary

During the course of 2023 Afentra has successfully utilized the first two tranches of the RBL Facility to complete the acquisitions of INA’s and Sonangol’s interests. Afentra finished 2023 in a strong financial position with a net debt position of $14 million post completion of both acquisitions. Cash reserves at year end were $19.6 million with $33.6 million drawn on the RBL Facility. During the year Afentra made drawdowns on the Working Capital Facility which has been repaid in full post the August cargo lifting. As at year end 2023 the WC Facility had full availability of up to $30 million.

The asset generated cashflow of $67.4m based on lifting revenues less cash calls and Petroleum Income Tax paid. This asset cashflow contributed to the reductions in the final completion payments for both the INA and Sonangol transactions and will also contribute towards the Azule transaction completion adjustments.

Afentra sold its first cargo of 300,000 bbl in August at an average price of $88/Bbl and since that time had accumulated a further stock position at year end of approximately 300,000 bbl comprised of entitlement production related to INA and Sonangol purchased working interests. With the accumulated stock position and further production over the course of January and February 2024 Afentra has scheduled its first 2024 lifting of approximately 450,000 bbl for late February 2024. With the planned lifting in February, and in light of the recent volatility in oil prices Afentra has proactively hedged 70% of the scheduled February cargo, providing downside protection below $70/bbl and leaving Afentra with full exposure to the crude oil price upside.

The Company intends to fund the anticipated completion of the Azule transaction in Q1 2024 largely via a drawdown on the existing RBL Facility, supplemented by the WC Facility and cash resources, as required. The final capital structure for the combined Angolan acquisitions will be optimised at completion of the Azule transaction. Afentra will provide a further financial update at the time of Azule completion estimated to take place in late Q1 2024.

As previously communicated, both INA and Sonangol acquisitions have contingent structures with contingent payments subject to oil price and production hurdles. Each of the contingent payments is tested at year end against the agreed thresholds. The Company expects to pay a total of $4.6 million in crystallised contingent payments (related to 2023) to Sonangol and INA during Q1 2024 

As previously reported approval was given for the extension of the Block 3/05 License to 2040 along with improved fiscal terms and the redistribution of the China Sonangol International’s interests, thereby increasing Afentra’s interest in Block 3/05A from 4% to 5.33%; this interest will further increase to 21.33% upon completion of the Azule acquisition.

Investor Presentation

Afentra’s management team intends to host an investor presentation via the Investor Meet Company platform in late Q1, with a date to be set in due course.  During the presentation the management will provide more detail on the operational programme and objectives for the current fiscal year.

1 Barrels of water injected per day

2 Restricted cash relates to the $4.9m deposit held in Escrow associated with Azule transaction.

3 Afentra’s interest in Blocks 3/05 and 3/05A will increase from 18% to 30% and 5.33% to 21.33%, respectively, upon completion of the Azule acquisition.

And finally…

In the Babygrow Cup Chelsea beat Middlesboro last night and will play either the Cottagers or Liverpool who meet in today’s other semi final.

At 4 am tomorrow morning England play India in the first of a 5 test series, Ben Foakes is back and Bairstow bats for Brook.